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Deal with Volksbank - an important step in Sberbank's international strategy

February 16, 2012, 8:30 UTC+3
In this deal Sberbank purchased 100 percent of VBI's shares
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VIENNA, February 16 (Itar-Tass) — CEO of Russia’s Sberbank German Gref said here on Wednesday that closing the deal with Austria’s Volksbank is an important step in implementing Sberbank’s international strategy. In this deal Sberbank purchased 100 percent of Volksbank's   International (VBI) shares and about 300 of bank branches in eight East European countries and Ukraine.

The transaction amount was reduced from 585 million to 505 million euros, which, according to the head of Sberbank, “corresponds to the current market situation.” In addition, he said, the current shareholders will also compensate for losses sustained over the first three quarters of last year, amounting to 81.5 million euros. Gref also said that Sberbank replaced the long-term funding from the current shareholders to the tune of about 2.3 billion euros, and the current shareholders offered Sberbank a five-year syndicated loan worth 500 million euros. “With this we are closing all our current issues,” Gref said.

“We have a unique time now to make transactions,” the Sberbank head continued. “We are going through one of the most difficult periods for all lending institutions. However, we assume that in a very short period of time will be able to enter the high-potential markets of Central and Eastern Europe, which in terms of the  bank assets' size  is only slightly behind the Russian market. Russia’s total assets are approximately 678 billion euros, and total assets of Central and Eastern Europe - 553 billion euros. Thus, we are entering a new, comparable in size market, and Sberbank opens the European page in its 170-year history.”

Gref also said that Sberbank has got an approval from a number of regulatory authorities in the EU countries - Austria, Hungary, Slovakia, the Czech Republic and Slovenia, which “is a confirmation of our transparency and stability.” “Sberbank as a new shareholder,” he continued, “will bring fundamentally new technology, capital, funding, products that will allow us in the coming years to build a strong banking platform in Europe, open to organic growth and the potential future acquisitions. For our clients this provides new opportunities for work with Sberbank and the countries where we are present, it is access to the most modern banking services.” The headquarters of the European presence of Sberbank, Gref said, will be in Vienna, from where all the European banking operations, except for the investment activity, will be carried out.

The Sberbank chief expressed confidence that the deal with Volksbank will also have a “synergistic effect” for the CIS countries. He said in conclusion that The Economist magazine published in its Wednesday’s issue a list of the best ten companies that brought the largest revenue to its shareholders over the past 10 years. Sberbank is second in this list after Apple. For every 100 US dollars invested in 2002, its shareholders received a return on capital worth 3,722 dollars.

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